Monday, August 25, 2014

This morning I read in a German newspaper that a quarter of the people living in cities in the famous Ruhrgebiet, the industrial area par excellence that propelled post-war economic growth and prosperity in Germany and other countries in Europe such as the Netherlands, is living in poverty.

My sister, who lives in Greece, is telling me continuously how poor people in Greece are suffering the consequences of a crisis that they did not cause, but that was caused by the rich (and the less rich) in the United States and Europe as well as in other countries including Greece. I hear similar stories from friends in Portugal, Spain and Italy. But poverty is not restricted to southern Europe.

In letting the poor pay for the problems the rich have caused there is an important and democracy undermining mechanism: austerity measures and privatisation of public services are presented as if the people themselves wanted them. 'Democracy' is willingly used to 'legitimise' measures that favour the rich.

As a result, people are losing confidence that democracy (which is reduced to voting for politicians who seem to care more about those who have power rather than those who lack power) will bring them any good. This is part of the explanation of why xenophobic, populist parties and movements have gained such strength in Europe.

How come the poor are still voting and keeping the rich in policy influencing positions that are contrary to their interests?

The answer is simple: because they do not see or are not aware of an alternative. An equally important explanation is, because they think the normal state of affairs is that the rich, and the so-called experts (lawyers and economists) decide.

Can we break this unfortunate and democracy undermining 'normal' state of affairs? I will try to answer that important and difficult question in one of my next posts.

Sunday, August 24, 2014

In 1982I had spentseven months inMexico,Nicaragua, Belize, Costa Rica, Panamaand Brazil to talk to small farmers, economistsand(former) politicians including theformer president ofCosta Rica, DonPepe, that is, José Figueres,about the external debt problem of Latin America andthe international economic policies of rich countries that contributed to its emergence.

José Figueres was critical of the economic policies of rich, western economies and I promoted his views, and those of others including Wim Duisenberg, Jan Kregel and Maria da Conceição Tavares, in 1983 in a booklet published jointly by the Dutch Labour Party and the Transnational Institute. Jan Timbergen lauded the booklet saying, "it sheds light on aspects [of the debt crisis] that the media hide in jargon. The sense of humour... makes it a good read."

The kids on the picture above are my daughter and son. They are now 29 and 27. My daughter works at the Netherlands Ministry of Education, Culture and Science in The Hague, and my son works at the Science Park in Amsterdam where he is doing a PhD in computational science.

Friday, August 22, 2014

Many years ago, in the early 1980s, famous Brazilian economist Maria da Conceição Tavares told me that the best book I could read about the global financial system was The International Money Game by Robert Aliber.

I bought it, read it, and liked it.

Last year, I had the privilige of seeing Robert Aliber at a meeting in Brussels. I liked his talk and asked him whether he had ever been at the Dutch central bank to tell my friends there how he sees the current crisis. He had not, so I arranged a visit for him to De Nederlandsche Bank (central bank) in Amsterdam. He met various people and gave a seminar.

Talking to him over lunch, and during a visit of the two of us to the Rijksmuseum, and at a dinner with him, my wife, and two friend of us (one of them is a member of the Board of FONDAD), I had the opportunity to share ideas, experiences and emotions.

Later, back in the US, Bob Aliber let me know he had very much enjoyed his trip to Amsterdam.

Monday, October 13, 2008

When I look at my face in the mirror while shaving my beard, I always think of
my uncle Gino from Toronto, who used to give investment advice (he had his own
investment letter for many years). One morning, the only morning I stayed at his
home near Toronto, he told me that I did not need to hurry when shaving, as this
would not finish the job more quickly. "Just do it quietly," he
suggested.

This morning I had to think of my uncle Gino's advice when I
was hurrying back to my computer to finish a post I've wanted to write for a
long time, about visions of the future of finance in the global system. Why
should I be in a hurry, I said to myself, if it won't speed the writing of a
good piece?

The picture shows my uncle Gino in his youth, in the
Netherlands. He died a couple of years ago, in Canada, the country that had
become his new home when he emigrated in the late 1940s or early 1950s. I know
him as one of my many uncles and aunts in Canada (my brother also lives in
Canada). Gino was a successful investment adviser until he lost his money, not
because of an international credit or debt crisis but because of something
else.

PS: I see that the original date of drafting the first two
paragraphs of this post appears as the date of this post. However, today it's 25
November 2008 and not 13 October 2008, so "normally" I would have felt that I
should hurry to finally finish that post on visions of the future. But,
listening to my uncle Gino's advice and seeing the speed of information and the
speed of financial transactions as one of the problems of global finance and
development, I know that slow writing (and slow financial transactions) may make
a better contribution to world stability than all this frenzy chasing after
financial news and financial opportunities.

Es esa locura de "breaking
news" y "today's financial opportunities" (Act now!) en que vivimos que es una
de las causas de la crisis... It is this madness of "breaking news" and "today's
financial opportunities" in which we are living that is one of the origins of
the crisis...

Wednesday, August 20, 2014

A year ago I wrote on my other blog, in Spanish, that while my wife and I
were listening to the singing of the blackbird (merel in Dutch) in our garden and having
breakfast, I said we should be able to stop for a day or a week
the world of agitated minds, to make them think and talk more calmly
about a few key problems of our capitalist world.

That is the kind of
psychological mood (with the extremes of individual and mass hysteria...
by the way, is neoliberalism a kind of mass hysteria or is it just a
doctrine?) of calmness that I would favour when a policy alternatives oriented G24 or G25 (see my post A new G24 to change the world?) would discuss a mass media and internet campaign (making use
of facebook and blogger and whatever there is to reach younger people,
which is crucial, as this should be a wide and long horizon effort) on
the basis of experts giving talks at parliaments.

The title I gave to my post of a year ago on the other blog (its name is "Tutto è possibile") was "Manca la calma", which I would translate into "Calmness is Missing".

Tuesday, August 19, 2014

In the previous post I spoke about the horrible world of finance and economic policies. But it need not be horrible at all, or, in correct English: the world of finance and economic policies does not need to be horrible. And, I would add, you can also enjoy looking at the world of finance and economic policies and engage with joy in actions and thinking related to that world.

The reverse of what I wrote in my previous post can also be true: the horrible world of international solidarity.

When I was seventeen I went a whole day to a psychological test bureau in Utrecht to help me choosing the right university study. At the end of the day they suggested to me to study either economics, sociology or dentistry. I chose sociology as I thought (and still think) economics is part of it.

When I was forty and had already founded FONDAD, I went through a long and difficult period of conflict with NGO leaders participating in FONDAD who pretended to represent the world of international solidarity. I learned a lot thanks to that conflict (they tried to kick me out of my office in The Hague and tried to forbid me to use the name FONDAD) including that those who are working in the world of international solidarity can be terrible, opportunist and full of false pretenses.

Would I have been able to work with joy in the world of finance and economic policies?

There is a funny note to my psychological test in Utrecht at age seventeen. The testers thought it likely that I would abandon my study in economics after a couple of years to become a banker. (That was not the reason I dropped the idea of studying economics; the reason for that was what I just said.)

How does one become a banker? What emotional character or mood drives you to become a banker and stay a banker, either a commercial or a central banker?

I will ask some of my banker friends, both from commercial and central banks.

Thelampabove, a'kroonluchter' in Dutch,comes from the office of the directorof Fondadwhen he still had his office in The Hague,in the same streetwhere thepalaceof QueenBeatrix is (was), theNoordeinde. In that samestreet there was(is) an art gallerythat I likedvisiting toforget for a momentthe horribleworld of financeandeconomic policies thatfavours those who have a lot of money, rather than those with littleor no money.

Fromroughly(there is noprecisedate)1972onwards I have lived intwo worlds, oneof human solidarityand the other of money and power.I movebetween these twoworlds andit is a miracle(I prefer the Italian wordmiracolo) that I have notbecome schizophrenic.

Monday, August 18, 2014

Thinking about how policy proposals can be made to be adopted I remember what I once wrote in a long article published in English and Japanese, in which I said in the first paragraph that economic policymakers tend by both temperament and training to be rather narrow-minded; their thinking moves in a groove.

I said this in the mid-1980s and I think that part of the explanation for the current crisis in the core of the capitalist world lies in this narrow-mindedness and 'groove' thinking of policymakers. And I do not think that they will change, nor that others can convince them to change their mind.

So it seems that my whole idea of forming an international group of 24 or 25 experts who will advocate in various parliaments around the globe a change of policies, is a hopeless effort. Just like all the other efforts.

Sunday, August 17, 2014

I want to invite you to agree or disagree with a thought I am playing with to stimulate my thinking about an agenda for the proposed new G24 (some readers have suggested to call it G25 to distinguish it from the existing G24):

I do not think we should maintain or make more shock proof the current world financial system and give it a crucial role in restoring global economic growth.

Instead, we should reform the international monetary and financial system and think more about, and discuss more widely, the kind of global economic growth (or de-growth) we want in response to needs and desires, and the way a reformed global financial system may support growth or de-growth.

Even though reform of the global financial system lacks the support from Europe and the United States, we should continue efforts to reform the system.

This is one of the issues for which the G25 should formulate good policy proposals and find the right people to promote them.

About Me

As a kid I liked numbers and the sound of strings. I considered studying engineering but chose social sciences because of my interest in people. I combine a theoretical interest with a practical, social approach which brought me to the sphere of policy research. I am interested in reducing the disparity between poor and rich, between the powerful and the less powerful.
In 1973 and 1982 I lived in Latin America. In the mid-1980s, I was able to create an international forum to discuss the functioning of the international monetary system and the debt crisis, the Forum on Debt and Development (FONDAD). I established it with the view that the debt crisis of the 1980s was a symptom of a malfunctioning, flawed global monetary and financial system.
I was one of the driving forces behind the creation of the European Network on Debt and Development that was established at the end of the 1980s to help put pressure on European policymakers.
In 1990, before the beginning of the Gulf War, I cofounded the Golfgroep, a discussion group about international politics comprising journalists, scientists, politicians and activists that meets regularly.
The website of FONDAD is www.fondad.org